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Bitcoin Climbs to Three-Month High as US Treasury Moves Revive Debasement Trade
Summary
- Bitcoin (BTC) has rebounded sharply in recent sessions, rising to its highest level in three months.
- US Treasury Secretary Scott Bessent’s intervention in the Treasury market helped spur demand for alternatives to the dollar, supporting Bitcoin’s advance.
- Zerohedge said $83,000 is the key price level to watch for confirmation of a continued uptrend.
Forecast Trend Report by Period
Bitcoin has rebounded sharply to its highest level in three months, with renewed concern over US fiscal policy and the dollar reviving the so-called debasement trade.
Zerohedge on Aug. 25 cited the trade’s reemergence as a driver of Bitcoin’s recent strength. It said US Treasury Secretary Scott Bessent’s intervention in the Treasury market spurred demand for alternatives to the dollar, helping fuel the cryptocurrency’s advance.
The Treasury had earlier decided to expand buybacks of long-term government bonds. Expectations that it could use cash from the Treasury General Account, or TGA, to finance those purchases helped push long-term yields down from recent highs. That, in turn, renewed demand for trades aimed at hedging against the US fiscal burden and a weaker dollar.
"The debasement narrative is back, pushing Bitcoin to a three-month high," Zerohedge wrote. Bitcoin has since given back part of its gains after the recent surge.
Still, the latest crypto rally may not be explained by dollar weakness and fiscal concerns alone. Zerohedge identified $83,000 as a key level for confirming whether the uptrend will continue.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.